Alphabet’s Record-Breaking Results Propel Wall Street Higher
In a week marked by concerns over inflation and economic growth, Wall Street found some relief on Friday as Alphabet’s robust quarterly results pushed its market value over $2 trillion, lifting most megacap growth stocks in the process.
Alphabet, the parent company of Google, saw its shares surge by 10.1% to a record high after announcing its first-ever dividend, a $70 billion stock buyback, and beating estimates for first-quarter results. This milestone briefly pushed the search giant’s market value over the $2 trillion mark on an intraday basis.
The positive momentum continued with Microsoft rising 2.5% after surpassing Wall Street estimates for third-quarter revenue and profit, driven by gains from AI adoption across its cloud services. Other growth stocks like Amazon.com and Nvidia also traded higher, up 2.9% and 5.0% respectively.
Additionally, U.S. monthly inflation rose moderately in March on an annual basis, in line with estimates on a monthly basis. This report, along with strong consumer spending data, provided some relief to financial markets rattled by concerns of stagflation.
Despite mixed economic data, the upbeat earnings across several sectors this week have propped up Wall Street’s main stock indexes for weekly gains. The benchmark S&P 500 is looking to snap three weeks of losses, while the Nasdaq is set to end four straight weeks of declines.
At midday, the Dow Jones Industrial Average was up 0.24%, the S&P 500 was up 0.96%, and the Nasdaq Composite was up 1.94%. Communication services led gains, jumping 4.1%, while energy sector stocks experienced a 1.7% fall.
Snap surged 26.4% after beating first-quarter estimates, while Exxon Mobil lost 3.6% and Intel dropped 9.9% on weaker-than-expected results. Overall, advancing issues outnumbered decliners, indicating a positive sentiment on Wall Street.
With earnings season in full swing, investors will be closely watching for further developments in the coming weeks.